WTI and eyes on new records.
Today oil prices jumped again as finally EU members reached a common point of view and agrees to the Russian oil embargo. The sixth sanctions package says that the EU will end imports of Russian crude and refined products from the end of 2022. This agreement was reached after other members could eliminate Hungary, Czechia, and Slovakia's concerns by extending the imports via pipelines.
The US and European summer constantly increase the demand for driving, and the holiday season increases gasoline and diesel consumption. After the EU announcement on Tuesday and while demand is increasing, oil price jumped higher and continues to maintain growth signs. At the same time, China decided to lift some coronavirus restrictions to increase the demand there.
Right after the news and announcement, Brent crude for July rose almost 2% to test above $124 a barrel, and its highest since March 9. WTI also increased above $118. Although this embargo will have a maximum effect of around 1.5 million barrels per day (bpd) as two-thirds of the Russian crude oil exports are seaborne and by pipelines.
From a technical point of view, WTI has already moved out of its range and breathed the critical level at $115. If it can hold this level and close above that, we can hope to see March peaks above USD 128; however, if the bull's power will not be enough to hold this level, still it is in a bullish trend with a slower pace to move.